US cars won’t be running on low-carbon biofuels next year as planned—because there aren’t any

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The US government is bowing to the reality that the biofuel-powered future is not going to arrive as soon as it had hoped. In 2007, Congress passed a law setting quotas for the production of low-carbon biofuels to fight climate change. This year, for instance, the country should be producing 1.75 billion gallons of cellulosic biofuels – go-go juice made from the inedible parts of plants. It has not quite worked out that way.

On Friday the US Environmental Protection Agency (EPA) proposed to essentially erase that quota, cutting it by 99% to 17 million gallons in 2014. That’s just 0.01% of total biofuel production. Quotas for total biofuel production from all sources – including corn ethanol and biomass-based biodiesel – would fall from 18.2 billion gallons to 15.1 billion gallons in 2014.

So what happened? The short answer is that making biofuels, particularly the cellulosic sort, is proving to be much harder than entrepreneurs, investors, and not least of all, the government expected. Engineering enzymes to break down tough plant fiber into feedstock that can be used to make substitutes for gasoline and jet fuel has been slow going, and investors burned by the Great Recession have been reluctant to pour hundreds of millions of dollars into building biofuel refineries.

The EPA noted that it was just last year that the first large-scale cellulosic biofuel refineries went online and began producing fuel in significant quantities. (Nonetheless, the EPA had set a cellulosic biofuel production quota of 6 million gallons in 2013.) The unachievable quotas have enraged the oil industry, which found itself forced to pay penalties under the law for failing to use non-existent biofuels.

Still, hope springs eternal at the EPA. “New facilities projected to be brought online in the United States in 2014 would increase the production capacity of the cellulosic industry by approximately 600%,” the agency noted, estimating that total production next year could reach 30 million gallons.